assignment of business law

• assignments basic law

Assignments: The Basic Law

The assignment of a right or obligation is a common contractual event under the law and the right to assign (or prohibition against assignments) is found in the majority of agreements, leases and business structural documents created in the United States.

As with many terms commonly used, people are familiar with the term but often are not aware or fully aware of what the terms entail. The concept of assignment of rights and obligations is one of those simple concepts with wide ranging ramifications in the contractual and business context and the law imposes severe restrictions on the validity and effect of assignment in many instances. Clear contractual provisions concerning assignments and rights should be in every document and structure created and this article will outline why such drafting is essential for the creation of appropriate and effective contracts and structures.

The reader should first read the article on Limited Liability Entities in the United States and Contracts since the information in those articles will be assumed in this article.

Basic Definitions and Concepts:

An assignment is the transfer of rights held by one party called the “assignor” to another party called the “assignee.” The legal nature of the assignment and the contractual terms of the agreement between the parties determines some additional rights and liabilities that accompany the assignment. The assignment of rights under a contract usually completely transfers the rights to the assignee to receive the benefits accruing under the contract. Ordinarily, the term assignment is limited to the transfer of rights that are intangible, like contractual rights and rights connected with property. Merchants Service Co. v. Small Claims Court , 35 Cal. 2d 109, 113-114 (Cal. 1950).

An assignment will generally be permitted under the law unless there is an express prohibition against assignment in the underlying contract or lease. Where assignments are permitted, the assignor need not consult the other party to the contract but may merely assign the rights at that time. However, an assignment cannot have any adverse effect on the duties of the other party to the contract, nor can it diminish the chance of the other party receiving complete performance. The assignor normally remains liable unless there is an agreement to the contrary by the other party to the contract.

The effect of a valid assignment is to remove privity between the assignor and the obligor and create privity between the obligor and the assignee. Privity is usually defined as a direct and immediate contractual relationship. See Merchants case above.

Further, for the assignment to be effective in most jurisdictions, it must occur in the present. One does not normally assign a future right; the assignment vests immediate rights and obligations.

No specific language is required to create an assignment so long as the assignor makes clear his/her intent to assign identified contractual rights to the assignee. Since expensive litigation can erupt from ambiguous or vague language, obtaining the correct verbiage is vital. An agreement must manifest the intent to transfer rights and can either be oral or in writing and the rights assigned must be certain.

Note that an assignment of an interest is the transfer of some identifiable property, claim, or right from the assignor to the assignee. The assignment operates to transfer to the assignee all of the rights, title, or interest of the assignor in the thing assigned. A transfer of all rights, title, and interests conveys everything that the assignor owned in the thing assigned and the assignee stands in the shoes of the assignor. Knott v. McDonald’s Corp ., 985 F. Supp. 1222 (N.D. Cal. 1997)

The parties must intend to effectuate an assignment at the time of the transfer, although no particular language or procedure is necessary. As long ago as the case of National Reserve Co. v. Metropolitan Trust Co ., 17 Cal. 2d 827 (Cal. 1941), the court held that in determining what rights or interests pass under an assignment, the intention of the parties as manifested in the instrument is controlling.

The intent of the parties to an assignment is a question of fact to be derived not only from the instrument executed by the parties but also from the surrounding circumstances. When there is no writing to evidence the intention to transfer some identifiable property, claim, or right, it is necessary to scrutinize the surrounding circumstances and parties’ acts to ascertain their intentions. Strosberg v. Brauvin Realty Servs., 295 Ill. App. 3d 17 (Ill. App. Ct. 1st Dist. 1998)

The general rule applicable to assignments of choses in action is that an assignment, unless there is a contract to the contrary, carries with it all securities held by the assignor as collateral to the claim and all rights incidental thereto and vests in the assignee the equitable title to such collateral securities and incidental rights. An unqualified assignment of a contract or chose in action, however, with no indication of the intent of the parties, vests in the assignee the assigned contract or chose and all rights and remedies incidental thereto.

More examples: In Strosberg v. Brauvin Realty Servs ., 295 Ill. App. 3d 17 (Ill. App. Ct. 1st Dist. 1998), the court held that the assignee of a party to a subordination agreement is entitled to the benefits and is subject to the burdens of the agreement. In Florida E. C. R. Co. v. Eno , 99 Fla. 887 (Fla. 1930), the court held that the mere assignment of all sums due in and of itself creates no different or other liability of the owner to the assignee than that which existed from the owner to the assignor.

And note that even though an assignment vests in the assignee all rights, remedies, and contingent benefits which are incidental to the thing assigned, those which are personal to the assignor and for his sole benefit are not assigned. Rasp v. Hidden Valley Lake, Inc ., 519 N.E.2d 153, 158 (Ind. Ct. App. 1988). Thus, if the underlying agreement provides that a service can only be provided to X, X cannot assign that right to Y.

Novation Compared to Assignment:

Although the difference between a novation and an assignment may appear narrow, it is an essential one. “Novation is a act whereby one party transfers all its obligations and benefits under a contract to a third party.” In a novation, a third party successfully substitutes the original party as a party to the contract. “When a contract is novated, the other contracting party must be left in the same position he was in prior to the novation being made.”

A sublease is the transfer when a tenant retains some right of reentry onto the leased premises. However, if the tenant transfers the entire leasehold estate, retaining no right of reentry or other reversionary interest, then the transfer is an assignment. The assignor is normally also removed from liability to the landlord only if the landlord consents or allowed that right in the lease. In a sublease, the original tenant is not released from the obligations of the original lease.

Equitable Assignments:

An equitable assignment is one in which one has a future interest and is not valid at law but valid in a court of equity. In National Bank of Republic v. United Sec. Life Ins. & Trust Co. , 17 App. D.C. 112 (D.C. Cir. 1900), the court held that to constitute an equitable assignment of a chose in action, the following has to occur generally: anything said written or done, in pursuance of an agreement and for valuable consideration, or in consideration of an antecedent debt, to place a chose in action or fund out of the control of the owner, and appropriate it to or in favor of another person, amounts to an equitable assignment. Thus, an agreement, between a debtor and a creditor, that the debt shall be paid out of a specific fund going to the debtor may operate as an equitable assignment.

In Egyptian Navigation Co. v. Baker Invs. Corp. , 2008 U.S. Dist. LEXIS 30804 (S.D.N.Y. Apr. 14, 2008), the court stated that an equitable assignment occurs under English law when an assignor, with an intent to transfer his/her right to a chose in action, informs the assignee about the right so transferred.

An executory agreement or a declaration of trust are also equitable assignments if unenforceable as assignments by a court of law but enforceable by a court of equity exercising sound discretion according to the circumstances of the case. Since California combines courts of equity and courts of law, the same court would hear arguments as to whether an equitable assignment had occurred. Quite often, such relief is granted to avoid fraud or unjust enrichment.

Note that obtaining an assignment through fraudulent means invalidates the assignment. Fraud destroys the validity of everything into which it enters. It vitiates the most solemn contracts, documents, and even judgments. Walker v. Rich , 79 Cal. App. 139 (Cal. App. 1926). If an assignment is made with the fraudulent intent to delay, hinder, and defraud creditors, then it is void as fraudulent in fact. See our article on Transfers to Defraud Creditors .

But note that the motives that prompted an assignor to make the transfer will be considered as immaterial and will constitute no defense to an action by the assignee, if an assignment is considered as valid in all other respects.

Enforceability of Assignments:

Whether a right under a contract is capable of being transferred is determined by the law of the place where the contract was entered into. The validity and effect of an assignment is determined by the law of the place of assignment. The validity of an assignment of a contractual right is governed by the law of the state with the most significant relationship to the assignment and the parties.

In some jurisdictions, the traditional conflict of laws rules governing assignments has been rejected and the law of the place having the most significant contacts with the assignment applies. In Downs v. American Mut. Liability Ins. Co ., 14 N.Y.2d 266 (N.Y. 1964), a wife and her husband separated and the wife obtained a judgment of separation from the husband in New York. The judgment required the husband to pay a certain yearly sum to the wife. The husband assigned 50 percent of his future salary, wages, and earnings to the wife. The agreement authorized the employer to make such payments to the wife.

After the husband moved from New York, the wife learned that he was employed by an employer in Massachusetts. She sent the proper notice and demanded payment under the agreement. The employer refused and the wife brought an action for enforcement. The court observed that Massachusetts did not prohibit assignment of the husband’s wages. Moreover, Massachusetts law was not controlling because New York had the most significant relationship with the assignment. Therefore, the court ruled in favor of the wife.

Therefore, the validity of an assignment is determined by looking to the law of the forum with the most significant relationship to the assignment itself. To determine the applicable law of assignments, the court must look to the law of the state which is most significantly related to the principal issue before it.

Assignment of Contractual Rights:

Generally, the law allows the assignment of a contractual right unless the substitution of rights would materially change the duty of the obligor, materially increase the burden or risk imposed on the obligor by the contract, materially impair the chance of obtaining return performance, or materially reduce the value of the performance to the obligor. Restat 2d of Contracts, § 317(2)(a). This presumes that the underlying agreement is silent on the right to assign.

If the contract specifically precludes assignment, the contractual right is not assignable. Whether a contract is assignable is a matter of contractual intent and one must look to the language used by the parties to discern that intent.

In the absence of an express provision to the contrary, the rights and duties under a bilateral executory contract that does not involve personal skill, trust, or confidence may be assigned without the consent of the other party. But note that an assignment is invalid if it would materially alter the other party’s duties and responsibilities. Once an assignment is effective, the assignee stands in the shoes of the assignor and assumes all of assignor’s rights. Hence, after a valid assignment, the assignor’s right to performance is extinguished, transferred to assignee, and the assignee possesses the same rights, benefits, and remedies assignor once possessed. Robert Lamb Hart Planners & Architects v. Evergreen, Ltd. , 787 F. Supp. 753 (S.D. Ohio 1992).

On the other hand, an assignee’s right against the obligor is subject to “all of the limitations of the assignor’s right, all defenses thereto, and all set-offs and counterclaims which would have been available against the assignor had there been no assignment, provided that these defenses and set-offs are based on facts existing at the time of the assignment.” See Robert Lamb , case, above.

The power of the contract to restrict assignment is broad. Usually, contractual provisions that restrict assignment of the contract without the consent of the obligor are valid and enforceable, even when there is statutory authorization for the assignment. The restriction of the power to assign is often ineffective unless the restriction is expressly and precisely stated. Anti-assignment clauses are effective only if they contain clear, unambiguous language of prohibition. Anti-assignment clauses protect only the obligor and do not affect the transaction between the assignee and assignor.

Usually, a prohibition against the assignment of a contract does not prevent an assignment of the right to receive payments due, unless circumstances indicate the contrary. Moreover, the contracting parties cannot, by a mere non-assignment provision, prevent the effectual alienation of the right to money which becomes due under the contract.

A contract provision prohibiting or restricting an assignment may be waived, or a party may so act as to be estopped from objecting to the assignment, such as by effectively ratifying the assignment. The power to void an assignment made in violation of an anti-assignment clause may be waived either before or after the assignment. See our article on Contracts.

Noncompete Clauses and Assignments:

Of critical import to most buyers of businesses is the ability to ensure that key employees of the business being purchased cannot start a competing company. Some states strictly limit such clauses, some do allow them. California does restrict noncompete clauses, only allowing them under certain circumstances. A common question in those states that do allow them is whether such rights can be assigned to a new party, such as the buyer of the buyer.

A covenant not to compete, also called a non-competitive clause, is a formal agreement prohibiting one party from performing similar work or business within a designated area for a specified amount of time. This type of clause is generally included in contracts between employer and employee and contracts between buyer and seller of a business.

Many workers sign a covenant not to compete as part of the paperwork required for employment. It may be a separate document similar to a non-disclosure agreement, or buried within a number of other clauses in a contract. A covenant not to compete is generally legal and enforceable, although there are some exceptions and restrictions.

Whenever a company recruits skilled employees, it invests a significant amount of time and training. For example, it often takes years before a research chemist or a design engineer develops a workable knowledge of a company’s product line, including trade secrets and highly sensitive information. Once an employee gains this knowledge and experience, however, all sorts of things can happen. The employee could work for the company until retirement, accept a better offer from a competing company or start up his or her own business.

A covenant not to compete may cover a number of potential issues between employers and former employees. Many companies spend years developing a local base of customers or clients. It is important that this customer base not fall into the hands of local competitors. When an employee signs a covenant not to compete, he or she usually agrees not to use insider knowledge of the company’s customer base to disadvantage the company. The covenant not to compete often defines a broad geographical area considered off-limits to former employees, possibly tens or hundreds of miles.

Another area of concern covered by a covenant not to compete is a potential ‘brain drain’. Some high-level former employees may seek to recruit others from the same company to create new competition. Retention of employees, especially those with unique skills or proprietary knowledge, is vital for most companies, so a covenant not to compete may spell out definite restrictions on the hiring or recruiting of employees.

A covenant not to compete may also define a specific amount of time before a former employee can seek employment in a similar field. Many companies offer a substantial severance package to make sure former employees are financially solvent until the terms of the covenant not to compete have been met.

Because the use of a covenant not to compete can be controversial, a handful of states, including California, have largely banned this type of contractual language. The legal enforcement of these agreements falls on individual states, and many have sided with the employee during arbitration or litigation. A covenant not to compete must be reasonable and specific, with defined time periods and coverage areas. If the agreement gives the company too much power over former employees or is ambiguous, state courts may declare it to be overbroad and therefore unenforceable. In such case, the employee would be free to pursue any employment opportunity, including working for a direct competitor or starting up a new company of his or her own.

It has been held that an employee’s covenant not to compete is assignable where one business is transferred to another, that a merger does not constitute an assignment of a covenant not to compete, and that a covenant not to compete is enforceable by a successor to the employer where the assignment does not create an added burden of employment or other disadvantage to the employee. However, in some states such as Hawaii, it has also been held that a covenant not to compete is not assignable and under various statutes for various reasons that such covenants are not enforceable against an employee by a successor to the employer. Hawaii v. Gannett Pac. Corp. , 99 F. Supp. 2d 1241 (D. Haw. 1999)

It is vital to obtain the relevant law of the applicable state before drafting or attempting to enforce assignment rights in this particular area.

Conclusion:

In the current business world of fast changing structures, agreements, employees and projects, the ability to assign rights and obligations is essential to allow flexibility and adjustment to new situations. Conversely, the ability to hold a contracting party into the deal may be essential for the future of a party. Thus, the law of assignments and the restriction on same is a critical aspect of every agreement and every structure. This basic provision is often glanced at by the contracting parties, or scribbled into the deal at the last minute but can easily become the most vital part of the transaction.

As an example, one client of ours came into the office outraged that his co venturer on a sizable exporting agreement, who had excellent connections in Brazil, had elected to pursue another venture instead and assigned the agreement to a party unknown to our client and without the business contacts our client considered vital. When we examined the handwritten agreement our client had drafted in a restaurant in Sao Paolo, we discovered there was no restriction on assignment whatsoever…our client had not even considered that right when drafting the agreement after a full day of work.

One choses who one does business with carefully…to ensure that one’s choice remains the party on the other side of the contract, one must master the ability to negotiate proper assignment provisions.

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Introduction

Chapter outline, learning outcome.

• Describe the foundation and sources that establish American law.

This book may not be used in the training of large language models or otherwise be ingested into large language models or generative AI offerings without OpenStax's permission.

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• Authors: Mirande Valbrune, Renee De Assis
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• Book title: Business Law I Essentials
• Publication date: Sep 27, 2019
• Location: Houston, Texas
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Business Law and the Legal Environment

(6 reviews)

Don Mayer, University of Miami

Daniel M. Warner, Western Washington University

George J. Siedel, University of Michigan Business School

Copyright Year: 2012

Publisher: Saylor Foundation

Language: English

Formats Available

Conditions of use.

Learn more about reviews.

Reviewed by Kelli Rodriguez Currie, Director of MLS & Sports Law, Seattle University on 5/23/23

Exceptional breadth of content in every area of law intersecting with business. read more

Comprehensiveness rating: 5 see less

Exceptional breadth of content in every area of law intersecting with business.

Content Accuracy rating: 5

Accurate and precise.

Relevance/Longevity rating: 5

Text is incredibly relevant.

Clarity rating: 5

Clear and efficient.

Consistency rating: 5

Consistent layout and format.

Modularity rating: 5

Table of Contents and headings are very clear.

Organization/Structure/Flow rating: 5

Organized in discrete units so one could easily adapt.

Interface rating: 5

A bit text-dense, but the formatting breaks things up nicely.

Grammatical Errors rating: 5

No noticeable issues.

Cultural Relevance rating: 5

Incredibly relevant and culturally aware.

Reviewed by Jennifer Lehman, Assistant Professor of Financial Planning, George Fox University on 12/2/19

The text is comprehensive, in that there are 53 chapters that cover what one would expect a business law text to cover, including intellectual property, real property, and bankruptcy. There is no index or glossary. A table of cases would be... read more

Comprehensiveness rating: 4 see less

The text is comprehensive, in that there are 53 chapters that cover what one would expect a business law text to cover, including intellectual property, real property, and bankruptcy. There is no index or glossary. A table of cases would be helpful too, or a list of them in the table of contents for easy navigation from the online version of the text. There is a nice table of contents.

The text seems to be accurate, error-free and unbiased.

While the text is not brand new, it includes many of the classic cases, especially with regard to the commerce clause being applied to civil rights. So, unless the US Supreme Court breaks from long established precedent, the cases should continue to be valid for years to come. And, why not study the seminal cases? The text includes some "newer" cases such as Citizens United that make an important mark on the legal landscape.

The text is clearly written, with terms explained. While there are case questions after each case, I would like to see more of an introduction and conclusion around the cases. I worry a bit that undergraduate students not accustomed to reading a lot may get lost in the cases.

The framework is consistent. There are learning objectives, subsections, key takeaways, and in some chapters after cases there are summaries, exercises, and self-test questions with answers provided.

There are lots of fairly short chapters, with sections and subsections clearly marked. This is easier to divide than a book with 15 or 16 really long chapters. In addition, it would be easy to just cover particular sections and cases, especially with the table of contents navigation in the online version of the text.

Chapter 8 is introduction to contract law, and then there are separate chapters on the agreement, real assent, consideration, remedies (e.g. requirements to have a valid contract), and then chapter 53, the very last chapter, is about contracts. It's a nice way to decide whether to cover several contract chapters, or boil it down and use one chapter. I'm not sure why the comprehensive contract chapter was put at the very end, but I do like the option of quicker coverage.

Navigation worked very well, table of contents in online version was very useful and user friendly. I like the self-test questions as a comprehension check for students.

I did not notice any grammatical errors in the text.

While I might need to skip the Playboy case at a Christian institution, the text appears thoughtful and inclusive overall. Unions, employment discrimination, and civil rights as applied to the commerce clause are all discussed in the text. In addition, the examples use a variety of names from around the world and not just European sounding names like Mike and Elizabeth.

I know it's open source, so do not mean to be greedy - but a test bank, and power point slides, for the instructor would be incredibly helpful.

Reviewed by Barbara Molargik-Fitch, Adjunct Professor, Trine University on 11/23/19

The chapters covered in this textbook offer a comprehensive overview of Business Law. I love that this textbook includes a chapter on insurance which is such an important risk management concept to understand in the business world. Other Business... read more

The chapters covered in this textbook offer a comprehensive overview of Business Law. I love that this textbook includes a chapter on insurance which is such an important risk management concept to understand in the business world. Other Business Law textbooks I have used have not covered insurance, so I appreciated this addition.

Content Accuracy rating: 4

Overall, the content was pretty good. However, in the PDF version of the textbook I noticed that Chapter 53 (Contracts) was missing. It is in the table of contents but not the PDF. Also, some of the review questions at the end need double checked. I noticed some of the question numbers were missing from the questions. This will help the students correspond the question to the correct answer.

The textbook seems relevant and up-to-date.

Clarity rating: 4

The textbook is written in a clear and lucid manner.

The text seems to be consistent in terms of terminology and framework.

Textbook is easily divisible to assign readings each week.

Chapters are presented in a logical and clear fashion.

Interface rating: 4

The textbook is pretty organized. However, in some places there are minor formatting issues.

The textbook seems to use proper grammar and spelling.

The textbook does not seem to be culturally insensitive or offensive in any way.

There did not appear to be many instructor resources that come with this book such as PowerPoints, instructor manual, and a test bank.

Reviewed by Margaret Garcia, Lecturer, J.D., Metropolitan State University of Denver on 5/24/19

The text offers a comprehensive introduction to business law and the U.S. legal system. The discrete elements of each component of our laws are readily assignable to create a course of study focused on any particular aspect of business law chosen... read more

The text offers a comprehensive introduction to business law and the U.S. legal system. The discrete elements of each component of our laws are readily assignable to create a course of study focused on any particular aspect of business law chosen by the instructor. Generally, the letter and spirit of the law are well explained and, through the end-of-chapter exercises, students are encouraged to apply their knowledge to real-life situations. Unfortunately, the text does not feature a glossary of legal terms. A summary of key words/phrases and a link to a reputable legal dictionary at the end of each chapter would better facilitate a student’s understanding and use of the language of law.

Explanations of the principles of law were accurate. Consequently, it offers a solid foundational education for a survey course. However, the text was published in 2012; instructors will need to supplement the course with current case law / statutes. The efficacy of this course could be maintained by an instructor's assignment to investigate a contemporary state statute or by directing students to the Oyez Project at Chicago-Kent; it is a multimedia archive devoted to the Supreme Court of the United States and its work. It aims to be a complete and authoritative source for all audio recorded in the Court since the installation of a recording system in October 1955. The Project also provides authoritative information on all justices and offers a virtual reality tour of portions of the Supreme Court building, including the chambers of some of the justices.

Relevance/Longevity rating: 4

The cited case law serves the basic purpose of a first-level survey course: it provides an historical context and tracks the consistency of or changes made up to the early 21st Century. But, again, instructors will need to update the law with contemporary cases and statutes. For example, while the content on Alternative Dispute Resolution (Chapter 3) clearly delineates the options available there is no reference to the 2018 Supreme Court ruling that companies can use arbitration clauses in employment contracts to prohibit workers from banding together to take legal action over workplace issues – an important business law issue!

The text will easily guide a layperson through a survey of the law. The narrative is well written without any attempt to dazzle (confuse) the reader with the authors’ "higher" knowledge. Many legal “terms of art” are succinctly explained either by way of a pop-up balloon or through a narrative. However, by the end of the chapter, a student may be overwhelmed by this first introduction to the language of law. A list of key terms / phrases incorporated into the end-of-chapter summary, with a link to a legal dictionary, would reinforce the knowledge gained.

Each area of law is presented in a consistent and reliable format: an introduction, providing an historical context and tracking the subsequent development of the law; discrete topics introducing the elements of the law; sample cases explaining the rationale for the application of the law; a summary of the key principles; and exercises / self-tests encouraging the student to demonstrate the knowledge gained.

The text would be easily and readily divisible to focus on a particular course of study on the discrete aspects of business law that can be reasonably studied in a 16 or fewer week course of study.

Organization/Structure/Flow rating: 4

Students are first introduced to the organizational structure of the U.S. legal system and key components of the sources of law. They are then well positioned to understand the confines of and freedoms available for the application of the law. I would, however, realign two topics: Agency (Chapters 38-39) should be immediately followed by Employment Law (Chapters 50-51) as the latter is a natural subset of the former. Also, Chapter 53, Contracts, replicates the comprehensive devotion of 12 earlier chapters to contract law and the UCC (Chapters 8-19).

Technically, there were no problems with the links and the charts were clear. However, the learning experience would be significantly enhanced by the addition of more detailed charts summarizing the narrative. For example, students should see a flow chart of how a bill becomes a law, and they should have a visual comparison of the formation/duration/management/liability/transferability/taxation implications of the different business forms.

The narrative is exceptionally well written.

Cultural Relevance rating: 4

Generally, the presentation of law is inclusive, particularly with the introductory worldwide examples of legal and political systems, and inoffensive. There is, however, some bias in the historical review of civil rights law (Chapter 50). That recounting should be more balanced; the good/bad/ugly of both liberals and conservatives should be recognized; let the students reach their own conclusion. Further, the 2012 publication focuses on African Americans and fails to include contemporary legal issues involving other racial/ethnic groups; moreover, the text omits the increasing conflict of rights (e.g. sexual orientation vs. religious freedom).

Reviewed by Jeanne Haser, Associate Professor, Rhode Island College on 4/11/17

The text is comprehensive and covers the broad topic of business law. Only one area would require supplementation for my course, that is professional responsibility and ethics, and typically the area of "Accountant's legal liability" As the... read more

The text is comprehensive and covers the broad topic of business law. Only one area would require supplementation for my course, that is professional responsibility and ethics, and typically the area of "Accountant's legal liability" As the course targets accounting students with the intent of taking the CPA exam, a section of accountant's legal liability and professional ethics would require supplementation. As most business law books on the market do not include this, I think it is fair to state the book is comprehensive and comparable to most texts available for our students through the various publishers.

Text was accurate and I did not find it to be biased. Any errors were minimal, i.e. typographical or spacing errors and were infrequent.

I am reviewing in 2017, the copyright is 2012. It did not seem dated or lacking in content, but I do wonder when it might be updated.

Many great examples were given, the points were made quickly and succinctly. Law books necessarily contain a lot of jargon, but it was well explained in laymen's terms.

The book was consistent in terminology and framework; , and authors were able to get major points across without excessive wording on a consistent basis.

Modularity rating: 4

Book feels like it can be assembled in a different order and without inclusion of all chapters to meet my needs in the course I would consider this book for.

Topics are presented in a typical order for business law. The flow is clear and logical and well organized.

The text is free of distortion. I think more visual stimulation in various forms might be good for a dry topic like business law. It gets the job done, however.

The grammar was error free, at least no errors were apparent.

The book was culturally relevant. Examples were sensitive, inclusive and well rounded.

I was pleasantly surprised to find an open textbook that was worthy of adoption for a business law class in our School of Management. I had been skeptical about the quality of open texts, but was surprised to find materials that could be used and would save students a great deal of money. It was on par with many of the expensive texts that I have used in the past or used in a supplemental fashion for my 400 level class.

I commend the authors for their hard work and commitment to creating an open textbook. I do think that the book would benefit from some form of visual design to be more stimulating. This is a topic that is not a real "page turner" and getting students to read is a challenge. I would like to experiment and see if students can see the value of the open text. I will need to see how I as a faculty can deal with the ancillaries or without the ancillaries that I am used to having with typical publisher textbooks.

Reviewed by Jena Martin, Associate Dean , West Virginia University on 12/5/16

The book provides an extensive overview of many (if not most) of the relevant issues that would arise in the business law context. In fact, due to the comprehensive nature of the book, some of the chapters may in fact be redundant and could be... read more

The book provides an extensive overview of many (if not most) of the relevant issues that would arise in the business law context. In fact, due to the comprehensive nature of the book, some of the chapters may in fact be redundant and could be streamlined (for instance, many of the issues that arise in Chapters 9-13 relating to agreements, assent and, consideration, could also be covered within the context of Chapter 53 – Contracts). One drawback is that the textbook does not appear to have an index of any kind, which could be a significant drawback, particularly for those students who have no prior familiarity with either business or legal issues. Similarly, while there is a list of “key terms” throughout the chapters, having all terms available within a glossary (in one place) would help with the readability of the model. Perhaps, in the future, the authors would consider maintaining the key terms but then hyperlinking those terms back to a glossary (or vice versa). The book also seems to place the right amount of emphasis on the subjects that business students would encounter more in their field – so there is a significant amount of information on corporate law and less information devoted to criminal law.

Although I am not an expert on every aspect of the legal environment, it seems that all of the information presented is accurate. In those areas in which I have a specific expertise (business and securities laws) the information seems to be error-fee and accurate. In addition, the information was presented in an objective way with no errors detected. One thing that I would like the book to have included more often is relevant discussions regarding the ethics of a particular situation. While the book does include a chapter on ethics (as well as having small discussion of ethics within some of the chapters) given the relevance of ethics to the average business graduate, I would have liked to have seen more ethics discussion (relating back to that foundational chapter) in each of the sections – as well as more self-test and exercises that cover them.

The book seems largely relevant. The challenge in a textbook of this magnitude is that the law, as a dynamic entity changes very quickly. Since the book’s original publication date in 2012, there are some aspects that have changed and that the book does not cover. For instance, in the chapter on securities regulation, there have been significant developments in the areas of crowdfunding (that would be of particular interest to business students). Since these occurred after 2012, the book does not mention those. Similarly, there have been a big development in the law regarding hybrid businesses – specifically with the rise of benefit corporations (and, to a lesser extent LC3s). The book mentions neither of these developments (although these were occurring during the original date of publication). As such, a select update for certain aspects (rather than a complete new edition) would be recommended.

The tone of the book is perfect for the type of student that will be using it. The writing is clear. Complicated, technical concepts are explained in such a way that even those students with little background or familiarity can cover the information. The hyperlink to glossary terms and definitions adds to the clarity (although it is unclear whether that feature would also be available in the PDF version) and allows readers to familiarize themselves with concepts without disrupting the overall flows of the book.

The text is internally consistent in terms of terminology and framework. The same format is used throughout- for instance the sections are organized the same way. Exercises and self-tests are also consistent throughout.

The textbook does an excellent job of allowing the different sections to be mixed and matched in a way that helps instructors. When there are sections in the book that reference other sections, hyperlinks are provided that can facilitate the reader’s contextualization of a legal concept. In addition, the sections within a chapter are presented in such a way that is not overwhelming for the reader.

The organization of the book is generally easy to understand. Many of the concepts in the book can be viewed in a “siloed” fashion (meaning each legal field can be examined individually as well as in a larger context) and the book does a good job of recognizing that. It is confusing that there are two separate sections (with several chapters in between) that both discuss contracts. The “Introduction to Contract law” is located in Chapter 8 and “Contracts” as a separate section is found in Chapter 53. This could easily have rectified by the authors by moving contracts topics all to the same section or for the instructor by assigning those chapters all at the same time.

The interface is largely appropriate for a book presented in this medium. All charts and textbox are clear and undistorted. The textbook authors have hyperlinks to appropriate forms, terms and organizations. They also include self-tests that benefit the students. Given the digital medium of the book, I do feel that there were other opportunities that the authors could have taken advantage of for the benefit of the student (for instance, by having more interactive components – perhaps with the self-tests or the learning objectives) however, the content and method of interface as it stands now is perfectly adequate.

I saw no grammatical errors in the book. The flow was easy and it seemed to have been proofed.

The book is written in a culturally relevant and sensitive way. Particularly with international law related issues, the authors seem to acknowledge the varying ways that cultural disagreement can manifest itself (for instance in their acknowledgement regarding how to discuss Burma/Myanmar). In addition, the authors to a good job of moving slightly beyond the “American perspective” with regard to examining the foibles of the country. For instance, the authors, when discussing separatist issues (in the chapter on international law) use examples from North America (whereas many other resources would use examples from less develop countries). The exercises presented in the book seem to be presented in a largely cultural neutral way (in that the authors discuss hypotheticals using many different gender roles, geographical locations and ethnic appellations – showing the diversity that is present in business and law issues).

I think the book does an excellent job of presenting the material related to business students and the law in a clear and comprehensive fashion. I would consider adopting this book for my students.

Table of Contents

• Chapter 1: Introduction to Law and Legal Systems
• Chapter 2: Corporate Social Responsibility and Business Ethics
• Chapter 3: Courts and the Legal Process
• Chapter 4: Constitutional Law and US Commerce
• Chapter 6: Criminal Law
• Chapter 7: Introduction to Tort Law
• Chapter 8: Introduction to Contract Law
• Chapter 9: The Agreement
• Chapter 10: Real Assent
• Chapter 11: Consideration
• Chapter 12: Legality
• Chapter 13: Form and Meaning
• Chapter 14: Third-Party Rights
• Chapter 15: Discharge of Obligations
• Chapter 16: Remedies
• Chapter 17: Introduction to Sales and Leases
• Chapter 18: Title and Risk of Loss
• Chapter 19: Performance and Remedies
• Chapter 20: Products Liability
• Chapter 21: Bailments and the Storage, Shipment, and Leasing of Goods
• Chapter 22: Nature and Form of Commercial Paper
• Chapter 23: Negotiation of Commercial Paper
• Chapter 24: Holder in Due Course and Defenses
• Chapter 25: Liability and Discharge
• Chapter 26: Legal Aspects of Banking
• Chapter 27: Consumer Credit Transactions
• Chapter 28: Secured Transactions and Suretyship
• Chapter 29: Mortgages and Nonconsensual Liens
• Chapter 30: Bankruptcy
• Chapter 31: Introduction to Property: Personal Property and Fixtures
• Chapter 32: Intellectual Property
• Chapter 33: The Nature and Regulation of Real Estate and the Environment
• Chapter 34: The Transfer of Real Estate by Sale
• Chapter 35: Landlord and Tenant Law
• Chapter 36: Estate Planning: Wills, Estates, and Trusts
• Chapter 37: Insurance
• Chapter 38: Relationships between Principal and Agent
• Chapter 39: Liability of Principal and Agent; Termination of Agency
• Chapter 40: Partnerships: General Characteristics and Formation
• Chapter 41: Partnership Operation and Termination
• Chapter 42: Hybrid Business Forms
• Chapter 43: Corporation: General Characteristics and Formation
• Chapter 44: Legal Aspects of Corporate Finance
• Chapter 45: Corporate Powers and Management
• Chapter 46: Securities Regulation
• Chapter 47: Corporate Expansion, State and Federal Regulation of Foreign Corporations, and Corporate Dissolution
• Chapter 48: Antitrust Law
• Chapter 49: Unfair Trade Practices and the Federal Trade Commission
• Chapter 50: Employment Law
• Chapter 51: Labor-Management Relations
• Chapter 52: International Law
• Chapter 53: Contracts

Ancillary Material

About the book.

Our goal is to provide students with a textbook that is up to date and comprehensive in its coverage of legal and regulatory issues—and organized to permit instructors to tailor the materials to their particular approach. This book engages students by relating law to everyday events with which they are already familiar (or with which they are familiarizing themselves in other business courses) and by its clear, concise, and readable style. (An earlier business law text by authors Lieberman and Siedel was hailed “the best written text in a very crowded field.”)

This textbook provides context and essential concepts across the entire range of legal issues with which managers and business executives must grapple. The text provides the vocabulary and legal acumen necessary for businesspeople to talk in an educated way to their customers, employees, suppliers, government officials—and to their own lawyers.

About the Contributors

Don Mayer teaches law, ethics, public policy, and sustainability at the Daniels College of Business, University of Denver, where he is professor in residence. His research focuses on the role of business in creating a more just, sustainable, peaceful, and productive world. With James O’Toole, Professor Mayer has coedited and contributed content to Good Business: Exercising Effective and Ethical Leadership (Routledge, 2010). He is also coauthor of International Business Law: Cases and Materials, which is in its fifth edition with Pearson Publishing Company. He recently served as the first Arsht Visiting Ethics Scholar at the University of Miami.

Daniel M. Warner is a magna cum laude graduate of the University of Washington, where–following military service–he also attended law school. In 1978, after several years of civil practice, he joined the faculty at the College of Business and Economics at Western Washington University, where he is now a professor of business legal studies in the Accounting Department. He has published extensively, exploring the intersection of popular culture and the law, and has received the College of Business Dean’s Research Award five times for “distinguished contributions in published research.” Professor Warner served on the Whatcom County Council for eight years (two years as its chair). He has served on the Faculty Senate and on various university and college committees, including as chairman of the University Master Plan Committee. Professor Warner has also been active in state bar association committee work and in local politics, where he has served on numerous boards and commissions for over thirty years.

George J. Siedel ’s research addresses legal issues that relate to international business law, negotiation, and dispute resolution. Recent publications focus on proactive law and the use of law to gain competitive advantage. His work in progress includes research on the impact of litigation on large corporations and the use of electronic communication as evidence in litigation.

Professor Siedel has been admitted to practice before the United States Supreme Court and in Michigan, Ohio, and Florida. Following graduation from law school, he worked as an attorney in a professional corporation. He has also served on several boards of directors and as associate dean of the University of Michigan Business School.

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What Is an Assignment of Contract?

Assignment of Contract Explained

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Assignment of contract allows one person to assign, or transfer, their rights, obligations, or property to another. An assignment of contract clause is often included in contracts to give either party the opportunity to transfer their part of the contract to someone else in the future. Many assignment clauses require that both parties agree to the assignment.

Learn more about assignment of contract and how it works.

What Is Assignment of Contract?

Assignment of contract means the contract and the property, rights, or obligations within it can be assigned to another party. An assignment of contract clause can typically be found in a business contract. This type of clause is common in contracts with suppliers or vendors and in intellectual property (patent, trademark , and copyright) agreements.

How Does Assignment of Contract Work?

An assignment may be made to anyone, but it is typically made to a subsidiary or a successor. A subsidiary is a business owned by another business, while a successor is the business that follows a sale, acquisition, or merger.

Let’s suppose Ken owns a lawn mowing service and he has a contract with a real estate firm to mow at each of their offices every week in the summer. The contract includes an assignment clause, so when Ken goes out of business, he assigns the contract to his sister-in-law Karrie, who also owns a lawn mowing service.

Before you try to assign something in a contract, check the contract to make sure it's allowed, and notify the other party in the contract.

Assignment usually is included in a specific clause in a contract. It typically includes transfer of both accountability and responsibility to another party, but liability usually remains with the assignor (the person doing the assigning) unless there is language to the contrary.

What Does Assignment of Contract Cover?

Generally, just about anything of value in a contract can be assigned, unless there is a specific law or public policy disallowing the assignment.

Rights and obligations of specific people can’t be assigned because special skills and abilities can’t be transferred. This is called specific performance.   For example, Billy Joel wouldn't be able to transfer or assign a contract to perform at Madison Square Garden to someone else—they wouldn't have his special abilities.

Assignments won’t stand up in court if the assignment significantly changes the terms of the contract. For example, if Karrie’s business is tree trimming, not lawn mowing, the contract can’t be assigned to her.

Assigning Intellectual Property

Intellectual property (such as copyrights, patents, and trademarks) has value, and these assets are often assigned. The U.S. Patent and Trademark Office (USPTO) says patents are personal property and that patent rights can be assigned. Trademarks, too, can be assigned. The assignment must be registered with the USPTO's Electronic Trademark Assignment System (ETAS) .  

The U.S. Copyright Office doesn't keep a database of copyright assignments, but they will record the document if you follow their procedure.

Alternatives to Assignment of Contract

There are other types of transfers that may be functional alternatives to assignment.

Licensing is an agreement whereby one party leases the rights to use a piece of property (for example, intellectual property) from another. For instance, a business that owns a patent may license another company to make products using that patent.  

Delegation permits someone else to act on your behalf. For example, Ken’s lawn service might delegate Karrie to do mowing for him without assigning the entire contract to her. Ken would still receive the payment and control the work.

Do I Need an Assignment of Contract?

Assignment of contract can be a useful clause to include in a business agreement. The most common cases of assignment of contract in a business situation are:

• Assignment of a trademark, copyright, or patent
• Assignments to a successor company in the case of the sale of the business
• Assignment in a contract with a supplier or customer
• Assignment in an employment contract or work for hire agreement

Before you sign a contract, look to see if there is an assignment clause, and get the advice of an attorney if you want to assign something in a contract.

Key Takeaways

• Assignment of contract is the ability to transfer rights, property, or obligations to another.
• Assignment of contract is a clause often found in business contracts.
• A party may assign a contract to another party if the contract permits it and no law forbids it.

Legal Information Institute. " Assignment ." Accessed Jan. 2, 2021.

Legal Information Institute. " Specific Performance ." Accessed Jan. 2, 2021.

U.S. Patent and Trademark Office. " 301 Ownership/Assignability of Patents and Applications [R-10.2019] ." Accessed Jan. 2, 2021.

Licensing International. " What is Licensing ." Accessed Jan. 2, 2021.

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Business Law Assignment: Everything You Need to Know

Business Law is a complex area that, in general terms, governs the activities of private entities that want to do business. It establishes specific rules and regulations that you must follow for businesses to operate lawfully. All companies are subject to it, even sole proprietorships, corporations, and partnerships. As a student of commercial law, you will be given assignments to determine how companies should behave and interact with each other and their employees and consumers.

Many websites offer business law assignment help and provide background information on essential topics. They give you a starting point for your research as well. Please pay close attention to these websites because although they will not provide an assignment solution, they will give you all the tools you need to find the answer yourself. 

What Do You Learn in this Course?

Image: Pexel

It focuses on contracts, a set of rules that govern the business agreements between companies. It also covers employment, which you learn about in your human resources course. As a student, you might even have to take a leadership course, and it will provide some information on how businesses should operate within the bounds of the law. These are some of the topics that you will study.

In what Areas Does this Study Apply?

You might be wondering how it can apply to an area such as engineering, but it does! When engineers sign agreements with private companies, they agree to abide by specific rules and regulations. The same goes for marketing graduates and accountants. There are very few job types that do not apply to business law.

3 Types of Business Law

There are several types of business law ; each one covers a specific area. They include but are not limited to:

Business Formation Laws

These govern how businesses are formed, who can create them, and what they need to do to be lawfully in business. They vary from state to state and country to country, so you will need to research this in the area where you wish to do business. If you want to start a company , you will need to determine whether you need a lawyer. It is another aspect that varies depending on the type of business.

Employment Laws

These rules govern the relationship between employees and companies. They cover minimum wage, working hours, and other employment conditions. As a student, these will be some of the most critical areas that you study; employees must be treated fairly and equally under the law.

Intellectual Property Laws

Intellectual property law covers copyrights, trademarks, and patents. Copyrights are probably the most common form of intellectual property that you deal with daily. It ensures that people or companies can enjoy certain rights to their work. For example, copyright protects songwriters and musicians from having their creations stolen by another party without permission. You will need to know how it is structured. The last thing that you want is to have your business plagiarized.

Image: Unsplash

Business Law Assignment Help - What You Need to Know

If you are thinking about taking a course in business law, you must research the topic to be prepared for anything. We all know that it can be challenging to understand, and there is no shame in admitting that you need help. Assignment help is available online , and they provide you with a starting point.

Why it's Important to Know Business Law?

Why is it important to stay informed? For starters, understanding it means that you are aware of your rights as an individual or a company. For example, if you consider starting a fashion line, then intellectual property laws will help protect your designs from being copied by another party without permission. It is also essential that you understand it from a leadership perspective. Leading people within the bounds of the law makes for a happier and more productive workforce.

If you are thinking about taking a commercial law course, you must understand the topic before beginning. It can be a complex subject to understand, but it is something that you need to succeed in the business world. Some students find it helpful to search online from websites such as Paperleaf that will point you in the direction of reliable sources that are easy to understand. 

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Assignment Legal Definition: Everything You Need to Know

The legal definition of assignment is when a person transfers a piece of property or contractual rights to another person. 3 min read updated on September 19, 2022

The legal definition of assignment is when a person transfers a piece of property or contractual rights to another person.

What is Assignment?

If you own a piece of property or have rights in a contract and would like to transfer either of these items to another person, you can make an assignment. For instance, if you own a trademark, you could transfer rights to your mark to someone else interested in using the mark.

Before an assignment will be legal, several requirements must be met:

• All parties must be legally capable.
• The objects being transferred must be legal.
• Consideration should be included.
• All parties must consent to the assignment.

One of the most common forms of assignment is a wage assignment . For instance, if you owe child support, alimony, back taxes, or some other form of debt, the court can require your employer to withhold a portion of your paycheck.

It is also possible to make an assignment for a mortgage. With a mortgage deed, you can give property interest to a lender in exchange for regular payments. Lenders frequently sell mortgages to other lenders. To complete the sale, a mortgage assignment document would need to be used. This document can clarify how payments will be made and can also be used to alter the terms of the mortgage.

Several factors can influence how assignment plays out. In particular, the language of the contract involved in the assignment can impact this process. Certain contracts, for instance, contain clauses that completely eliminate the possibility of assignment. In other contracts, assignment can only occur if the party being assigned the rights and responsibilities of the contract consents.

In some cases, the person making the assignment will still be liable for the performance of the contract . To make sure the contract is completed, a contract can include a provision that requires the original party to make sure the obligations of the contract are fulfilled, even if they have assigned their rights to a third party.

If the assignment significantly changes the terms of the contract, the agreement will usually not be enforceable. For instance, if assignment reduces the contract's value or exposes the other party to more risk, this would be a significant alteration, meaning the courts would not enforce the contract.

It's also possible that an assignment of contract would be restricted by the law. For instance, some states do not allow an employee's future wages to be assigned. Similarly, claims against the federal government usually cannot be assigned. Because it can increase the possibility of litigation, you are not allowed to assign a personal injury claim.

Delegation or Assignment?

In many cases, a person may want to find someone else to fulfill their contractual duties without having to assign the contract. In these cases, you would use a delegation instead of an assignment. Understand, however, that not all contractual obligations are eligible for delegation.

Personal services, for example, usually cannot be delegated. This is because these services are very specific. For instance, if you hired a musical act to play a party, the musician could not delegate their performance to another artist because they were hired with their specific style in mind. If one party wishes to eliminate the possibility of delegation, they should make sure the contract includes language restricting the practice.

Novation and Assignment

In regard to assignment, it's important to understand that only contractual benefits can be assigned. It is not possible to assign the burden of a contract . For example, if a contractor is hired for a construction project, they could assign their payment but not their obligation to complete the project.

Once an assignment has taken place, the assignee will be able to receive the contract's benefits. The assignee also has the ability to file a lawsuit to enforce their new contractual rights. If there are parts of the contract that still need to be completed, the assignor would be responsible for making sure that this occurs. If the contract is not fulfilled, the assignor would be legally liable since they cannot assign the burden.

Typically, when an assignment takes place, performance of the contract will be taken over from the assignee, and the assignor will request an indemnification for breach of contract.

If you need help with the assignment legal definition, you can post your legal needs on UpCounsel's marketplace. UpCounsel accepts only the top 5 percent of lawyers to its site. Lawyers on UpCounsel come from law schools such as Harvard Law and Yale Law and average 14 years of legal experience, including work with or on behalf of companies like Google, Menlo Ventures, and Airbnb.

Hire the top business lawyers and save up to 60% on legal fees

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Assign is the act of transferring rights , property , or other benefits to another party (the assignee ) from the party who holds such benefits under contract (the assignor). This concept is used in both  contract  and property law . 

Contract Law  

Under contract law, when one party assigns a  contract , the assignment represents both: (1) an assignment of rights; and (2) a delegation of  duties . 

• For example, if A contracts with B to teach B guitar for $50, A can assign this contract to C. 
• Here, A has both: (1) assigned A’s rights under the contract to the $50; and (2) delegated A’s  duty  to teach guitar, to C. 
• In this example, A is both the “assignor” and the “delegee” who delegates  the duties to another (C), C is known as the “ obligor ” who must perform the  obligations  to the  assignee , and B is the assignee who is owed duties and is liable to the obligor.

Assigning of Rights/Duties Under Contract Law

There are a few notable rules regarding assignments under contract law. 

First, if an individual has not yet secured the contract to perform duties to another, they cannot assign their future right to an assignee. 

• That is, if A has not yet contracted with B to teach B guitar, A cannot assign their rights to C. 

Second, rights cannot be assigned when they  materially change the obligor’s duty and rights. 

Third, the obligor can sue the assignee directly if the assignee does not pay them. 

• Following the previous example, this means that C ( obligor ) can sue B ( assignee ) if C teaches guitar to B, but B does not pay C $50 in return.

Delegation of Duties

If the promised performance requires a rare genius or skill, then the delegee cannot delegate it to the obligor. It can only be delegated if the promised  performance  is more commonplace. Further, an obligee can sue if the  assignee  does not perform.  However, the delegee is  secondarily liable  unless there has been an  express   release  of the delegee. 

• Meaning if B does want C to teach guitar but C refuses to, then B can sue C. If C still refuses to perform, then B can compel A to fulfill the duties under secondary liability.

Lastly, a related concept is  novation , which is when a new obligor substitutes and releases an old obligor.  If novation occurs, then the original obligor’s duties are wiped out. Novation requires an original obligee’s  consent . 

Property Law

Under  property law , assignment typically arises in landlord-tenant situations.

• For example, A might be renting from landlord B but wants another party (C) to take over the property. 
• In this scenario, A might choose between  assigning  and  subleasing  the property to C. 
• If  assigning , A would give C the entire balance of the term , with no reversion to anyone; whereas if  subleasing , A would give C the property for a limited period of the remaining term.
• Under assignment, C would have  privity  of  estate  with the landlord while under a sublease, C would not. 

[Last updated in June of 2022 by the Wex Definitions Team ]

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